Title: Taxable sale of real estate The objective of this thesis is to analyse law nr. 520 of 12 June 2009 considering VAT on delivery of new property, building land and separate sale of building land, and to explain when VAT is payable on the delivery of the mentioned real estate. It will be also analysed, if private person can be considered as taxable. Furthermore the derived consequences of this law will be analysed, which is various rights, that gives the holder exclusive rights over immovable property. It will be discussed when property shares, real rights, etc. are considered as real estate. These analyses focus on if the Danish law is implemented in accordance with VAT Directive. The thesis also includes the criticism of the new rules. Juridical practise of this law can be divided into two periods: juridical practice until EU-court decision in the cases C-180/10 and C-181/10 and juridical practice after EU-court decision in the cases C-180/10 and C-181/10. Both of the periods will be included in the analysis. EU law has precedence over national law and the EU-court's decisions determine the correct interpretation of the VAT Directive. Therefore Danish law has to be in accordance with EU rules and EU interpretation of the rules. It is only taxable persons that are affected by the new law. A taxable person means any person who, independently, carries out in any place any economic activity, whatever the purpose or results of that activity. Any activity of producers, traders or persons supplying services, including mining and agricultural activities and activities of the professions, is regarded as economic activity. VAT Directive Article 12, paragraph 1 is not implemented in Danish legislation; therefore Denmark cannot impose VAT on the occasional sale of new buildings and land. Before the cases C-180/10 and C-181/10 were made in public, situations had occurred, where TAX authorities considered private person sale of new buildings or building grounds as taxable transactions. According to SKAT, if a private person sells more than 3 building grounds, accounting for more than 1.400 m2, from the ground the person’s home were placed, it represents an independent economic activity, which is taxable. This was against EU rules, as the Danish law has not incorporated VAT directives article 12, paragraph 1. This juridical practice has changed after SKAT has published SKM2012.297.SKAT. According SKM2012.297.SKAT some changes were made, according to which private persons will not be considered as taxable: If a private person sells the building land, which is parceled out from the ground, which belongs to his private residence or holiday home for private use A private person’s subdivision of other building land, when parceling is related to subdivision of building land and sale of several parcels. This implies that the number and size of building grounds does not have any impact for determining the VAT liability. Only if the private person starts to develop building land with the road, electricity etc. can it be considered as a step towards economical activity, which causes transactions to be taxable. A building is new before its first occupation. Furthermore a building is new within the five-year period elapsing between the date of completion of the building and the date of the first supply or the second supply if the first supply was between interests’ related parties. A building is also considered new when the building has been rebuilt after the 25/50 % role. A taxable person’s supply of building land is always included by taxation. Until the cases C-180/10 and C-181/10 came up, taxable persons were always taxable for sale of new buildings, building land and separate sales of building land. The jurisprudence has changed after SKAT has published SKM2012.297.SKAT. A taxable person, who sells new buildings, building land or separate building land, is taxable of the transaction only, if he is acting in this capacity. However if the taxable person is acting in a personal capacity, the above-mentioned transactions are not taxable. The new rules for sale of new buildings and building land seems to be in accordance with EU rules. However the separate sale of building land does not have any background in the VAT Directive and therefore holds the possibility that the EU-court will come up with some decisions in similar cases and will determine the correct interpretation of the VAT Directive. The following topics are derivative consequences: property on stocks and stake; business transfer; options; interest in the new building or building site and construction rights. If the sale of above mentioned rights over new buildings or building land gives the holder thereof a right of use over this property, it is considered as supply of real estate and is thus taxable.
|Uddannelser||Cand.merc.aud Regnskab og Revision, (Kandidatuddannelse) Afsluttende afhandling|